A long history of failure will have to be overcome, with the pitfalls of previous failed attempts avoided, if New Zealand's possum problem is to be turned into a major export industry.

A proposal to pump pest eradication funds into supporting the possum fur, meat and leather industry was one of the top five ideas presented to Commerce Minister Simon Power at Thursday's Entrepreneurial Summit in Auckland.

The suggestion was that instead of spending $80 million per year on dropping the poison 1080 to kill off possums, the money ought to be reallocated into trapping or hunting bounties.

Other potential benefits suggested were increased export earnings, employment opportunities for low-skilled workers and the enhancement of New Zealand's clean green image.

However, many of these assumptions are being challenged by the Department of Conservation, which manages possum levels across the country.

Department senior advisor Herb Christophers told BusinessDay the last time bounties on possums were used in the mid 1960s, a great deal of economic damage was done.

"Someone realised they could make a government-backed income by releasing possums into [previously possum-free] Northland forests," said Christophers.

"Where is the last major population of kiwis? It's in Northland. And now with the possums in there, that population is under threat," said Christophers.

He said the department was not against trying to extract money from possums, but there needed to be a differentiation between ecological and economic management of them.

"The issue is not black and white... there is a vested interest [in the possum industry] for there to be a residual population of possums, whereas for conservation purposes there is a mandate to manage possum populations to a lower level than where you would get an economic return," he said.

Exploiting possums is not a new idea and various companies have attempted to do so - to varying degrees of success - in the past.

One of the most prominent was Kiwi Bear which was listed on the New Zealand stock exchange in January 1987, raising $2.8 million to harvest and process possum fur and meat.

Its business model involved trapping live animals and keeping them in captivity until their fur and meat was "finished" to become more desirable.

By its board's own admission in a 1988 profit result, Kiwi Bear's business model had become unsustainable meaning its prospectus turned out to be "incredibly optimistic".

Steve Boot, director of possum fur traders Basically Bush, told BusinessDay Kiwi Bear's model relied on very high whole fur and skin prices, which collapsed at the time of the stock market crash in 1987. Kiwi Bear was voluntarily wound up in April 1989.

He said the current industry now relies on merino wool and possum fibre blends which have proven to be popular both locally and overseas, creating what he estimates to be a $100 million per year industry.

He says hunters and trappers currently take around two million possums per year and with some serious policy commitment into research and export encouragement, the industry and harvest could double.

Boot also disagrees with establishing a possum bounty, saying it would be better for the industry to remain self-sustaining, but says conservation efforts must move away from mass 1080 drops.

"The current paradigm of using one of the most toxic substances on earth as the cornerstone of possum control is unsustainable. Our international reputation depends on the perception that we do things in a sustainable, environmental way," said Boot.

"Commerce shouldn't replace conservation, but not enough recognition is given to commercial work in possum control. There's no reason why commerce couldn't play a major part in possum control in New Zealand."